Closed loop addressable advertising (CLAA) systems are known that replace an original commercial advertisement in a broadcast television signal with a substitute commercial advertisement. The substitute commercial is targeted to a specific segment of the population that is likely to find the substitute commercial more effective than the original or other potential substitute commercial advertisement. This enables the operator of the video broadcast system to increase advertising revenues by charging advertisers a higher “per-viewer” rate in order to reach the target audience. Some advertisers can reduce overall advertising costs by directing their ads to smaller audiences, even though the per-viewer cost is higher. Advertisers are willing to do this because they believe the target audience is a better audience. For example, a luxury car dealer may advertise to a wealthier target audience that is able to afford its luxury cars by advertising only in higher income residential areas.
Closed loop addressable advertising (CLAA) systems typically use a set-top box (STB) in the viewer's home to swap the original and substitute commercials advertisements. The set-top box tunes to a user-selected channel and transmits the regular broadcast television signal provided by the cable company to the television set. However, when a commercial break is about to occur in the regular broadcast television signal, the cable company transmits a special-purpose “swap” signal to the set-top box that causes the set-top box to tune to another channel in which audience-specific commercial advertisements are being broadcast. After one or more targeted commercials are played on the viewer's television set, a second swap signal causes the set-top box to tune back to the original regular broadcast television signal.
The closed loop nature of the CLAA system derives from the fact that the set-top box (or some other peripheral device) is used to monitor the viewing habits of the viewer. The viewer information gathered in this manner is transmitted back to the broadcaster in order to allow data mining and other purposes. The information collected is typically remote control data indicating viewer channel selections and time stamps indicating the time spent viewing each channel. The gathered data may then be sold to the advertisers in order to target advertisements better and may be used to modify the viewing habits of the members of the household.
There are, however, drawbacks to the existing CLAA systems. Existing systems are bandwidth limited and one or more of a finite number of channels must be dedicated to the broadcast of the audience-specific commercial advertisements. The more audience-specific commercials that are added and the more groups that are targeted, the more bandwidth that is consumed. This leaves less channels available to carry the basic broadcast television programming.
There is therefore a need in the art for improved closed loop addressable advertising (CLAA) systems. In particular, there is a need for closed loop addressable advertising systems that provide a large number of audience-specific commercial advertisements while consuming only a minimum amount of the available television signal bandwidth.